As makeup begins a possible recovery, Ulta Beauty is laying off an unspecified number of corporate employees, a spokesperson told Retail Dive via email. The total number was "a meaningful, but relatively small number of our total associates," the spokesperson said.
The layoffs resulted from a restructuring that eliminated current and open roles across all functions in the company, reorganized certain positions, expanded others and added new positions to investment areas. They were a result of the impacts of the pandemic and the knowledge that "recovery will take considerable time and that the context we operate in has shifted meaningfully," the spokesperson said.
At the same time, the beauty retailer announced a new structure in its merchandising department, with Maria Salcedo promoted to senior vice president of merchandising for the makeup category. It's a change that brings all makeup categories — mass, iconic and prestige — under one leader, a spokesperson said.
Despite being a near-constant winner in the retail space, Ulta was not immune to the impacts of a global health crisis that has made businesses large and small enact cost-cutting measures, furlough employees, and sometimes shutter entirely.
In Q2, the retailer's net income fell 95%, though e-commerce grew 200%, and the prior quarter forced the retailer to cut its planned store openings from 75 down to 30. The challenges to in-store shopping have also hit key aspects of Ulta's business, including its in-store services and its loyalty program, which was down year over year in Q3 due to temporary store closures.
"While incredibly difficult, these decisions were made thoughtfully with a focus on resetting our corporate cost structure to operate more effectively and efficiently in the short-term as well as optimizing our enterprise capabilities to thrive in the long-term," a spokesperson said of the layoffs.
The retailer also cited trends that had been accelerated by the pandemic and a changing operating environment.
All in all, though, Ulta has not taken this year as hard as others in the sector. The retailer remained focused on investments, including launching a conscious beauty initiative over the summer focused on pairing up customers with brands that share their values and announcing a blockbuster partnership with Target for 100 shop-in-shops in the mass merchant's stores.
Ulta's new merchandising changes reflect the importance of that strategy. Melissa Myles Edwards is filling a newly created role as senior director of Target merchandising, among other shifts. Lisa Hamilton, vice president of merchandising of prestige makeup, will also take on iconic and boutique brands, and Sean Bentley will take over as senior vice president of merchandise planning, inventory and operations.